July 2022 - cypherpunks@lists.ogf.org

Welcome to the Ghetto
by professor rat 28 Jul '22

28 Jul '22

Ding Dong the Mong is dead https://marc.info/?l=cypherpunks&m=102686322326845&w=1 While I tend to agree with Tim about the shorter term trouble with micropayments -- the fact that such payments, well, do not pay -- I'd say in the longer term micropayments are what counts . . . " Welcome to the revolution!

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Milli meet Reg - Reg - Milli
by professor rat 28 Jul '22

28 Jul '22

Small transactions are in the news recently with a probably jurisdiction shopping ' arms race ' opening up between the biggest govt shitcoin banksters. Regulatory arbitrage won't save any pig-govts bacon - but the most liberal could last out the longest. Maybe. >>> . . . I don't think the spread of micropayments will be an exception to the rule. In fact I would argue that the only *lasting* surprise offered by AP was the fact that when mild wants of large numbers of people can be coordinated, economic efficiency can lead to significant, and heretofore unexpected, outcomes (i.e. getting a notable figure killed). In the end I think such new classes of financial transactions, borne of lowered transaction costs, will be far more significant to the society as a whole than anonymity. I also think this is the essence of what is driving the wider P2P circle, at the moment, though few people seem to realize it. <<<

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Before Julian there was Declan
by professor rat 28 Jul '22

28 Jul '22

List journalists - we ought to have them stuffed https://marc.info/?l=cypherpunks&m=102984700431372&w=1 Viva la revolution

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20th anniversary of third cypherpunk trial
by professor rat 28 Jul '22

28 Jul '22

Description of the third cypherpunk trial in the ongoing struggle for genuine cryptoanarchy https://marc.info/?l=cypherpunks&m=103098894328826&w=1 In Sept it will be 20 years since any govt dared tangle with any cypherpunk revolutionist. Losers gonna lose!

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Making quantum-crypto-FUD futile
by professor rat 28 Jul '22

28 Jul '22

Treat these cornball, journalistic, clickbaiting FUDmeisters as damage and route around them cos for every q-computer that can crack SOME - not all - present encryption, there will be 100 providing uncrackable crypto too cheap too meter. Eventually. https://phys.org/news/2022-07-quantum-cryptography-hacking-futile.html Quantum cryptography: Making hacking futile. QED.

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Crypto is down - but a journalist could die soon
by professor rat 28 Jul '22

28 Jul '22

Crypto appears to be bumping along a relatively cheap baseline at the moment. The net itself continues to do well overall despite massive, large-platform corruption. Russia's NKVD troops continue to be decimated - as indeed does the Media industry. One govt-registered, celebrity journalist is even predicted to die in the next few months. Very Assange.

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Elon Musk posing as an anarchist
by professor rat 28 Jul '22

28 Jul '22

Without any anarchist high command we can’t stop Randite, Paultard style frauds trying to steal our good name. But then they are not some protected species either. Take ’ John Galton " ex Acapulco. He’s as dead as Julius Caesar. If anarchism eluded us then - since not enough of us wanted to assassinate frauds like Elon Musk - that’s no matter - tomorrow we’ll run faster - stretch out our assassinphones further. And, now that the anarchists are in a ferment over preparations for the future, it is worthwhile to re-examine the branding question calmly and without preconceptions. I shall do so briefly from my point of view as a cryptoanarchist or assassin others will do so, should they wish, from their particular point of view. I use the word ‘assassin’ as an alternative to the word ‘communist,’ not because I like pointless new jargon, but because I foresee the possibility that the communist anarchists will gradually abandon the term ‘communist’; it is growing in ambivalence and falling into disrepute as a result of Russian & Chinese ‘communist’ despotism.

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Cryptocurrency: Early Game Theory
by grarpamp 28 Jul '22

28 Jul '22

For those missed it all... https://bitcoinmagazine.com/culture/bitcoin-is-teaching-realism-to-libertar… Bitcoin is Teaching Realism to Libertarians: An Interview With Old-School Cypherpunk Vinay Gupta * Author: Aaron van Wirdum * Publish date: Nov 5, 2014 As an old-school cypherpunk in the 1990s and one of the most active members of the E-gold community before this centralized precursor of Bitcoin got shot down, futurologist Vinay Gupta has been involved with digital currency for over fifteen years. He has also worked with the United States Departement of Defence on disaster relief and state failure issues, and helped develop CheapID, a genocide resistant biometric ID card for the NSA. He later turned his attention to global disaster prevention, and invented the Hexayurt: an open source dirt-cheap disaster relief shelter design which is used today in refugee camps and at festivals like Burning Man. Gupta has been appointed as the strategic advisor of the Ethereum communications team shortly before the publication of this interview, but he is probably best known within the Bitcoin-community for his interview-snippet from the upcoming IamSatoshi documentary, in which he discusses the politics of Bitcoin... Vinay, first of all, you describe yourself as a "global resilience guru". How resilient is Bitcoin? Well, if the Internet goes away, Bitcoin goes away, right? So it's vulnerable in the same way that civilization itself is vulnerable. But if civilization breaks down, almost any store of value becomes useless very quickly. It's not really clear that large piles of wealth sitting there actually exist without the state to protect them. That's easy to see for copyright and patent, but the same is true for most other passive types of ownership, such as stocks, bonds or futures. And we could go further. I own the house I live in, but that house next door that I'm renting to you? The reason it's mine, is because the state says it is. The ability to do large scale capital accumulation without having to need a private army is basically an artefact of pre-existing law. Some people prefer gold over Bitcoin, but even if you own a lot of gold, and civilization breaks down, you'll need people to guard your gold. And in all probability the people guarding your gold will end up owning your gold. Either a little bit at the time by guarding it, or all at once by dis-intermediating you from the gold shed. So because of the need of physical force to protect it, you could argue that gold is actually more vulnerable than Bitcoin. Because if the Internet goes down and stays down, something so bad has happened that it's probably gonna be machine guns on street corners. What about Bitcoin's resilience in regard to the state itself? Right, resistance to state interference... That's a really bold claim. I sort of need to see extraordinary evidence for things like that, because bluntly, the security state invented this stuff. It's fundamentally their kit. Most of the mathematics, most of the algorithms, most of the hardware, the internet itself, all these things are spin-outs of defence projects. And remember, we really tangled with these guys in the 90's. Public key cryptography was regarded a weapon of war back then. The American government was really friggin' pissed off at us, and did as much damage as they could within the law. Constant harassment, legal pressure, people lost their jobs... the whole thing was constantly on the verge of everybody ending up in jail as far as we could tell. Note that that is no longer true... Are you suggesting the cryptography underlying Bitcoin is compromised? Making the jump to saying Bitcoin is compromised is too far. But if you don't think of this within the very narrow parameters of cypherpunk history, if you put it in the larger scale of political struggle, then what did the US government do to every substantial opposition group? The American Indian movement: smashed with a hammer, you've probably never even heard of it. Black Panthers: smashed with a hammer, all that's left are the Crips and the Bloods. US peace movement: people will tell stories about going to meetings, and a third of the attendees were spies from different agencies. State, federal, local, FBI, CIA, DEA... You don't need to be a rocket scientist to figure out that the government has the vast majority of the cards on the table when it comes to force, and they're choosing to lay absolutely none of them on the crypto-community right now. Silk Road and all of the other drug trade sites that use Bitcoin would absolutely, without any shadow of a doubt, provide the legal reason for killing the Bitcoin-network and arresting everybody involved. Do everybody for drug trafficking, money laundering, all the rest of that stuff. But they've decided to better leave it up than to take it down. So you've got to ask yourself: why? Well... why? I don't know. But the idea that we right now have a relatively small group of crypto-Jedi, that are so much better at this stuff than the people who invented it, and as a result are gonna bring peace and liberty for all on earth... Really?! I'm not buying it. I don't think Bitcoin is necessarily the existential threat to the existence of the state as Tim May's old Cyphernomicon would have you believe it is. It is likely, however, that government without Bitcoin could very easily slide all the way into the establishment of total control over transactions by getting rid of cash and everything else. The ecological function of dissent inside a complex society is not that the dissent immediately takes over. It's that the dissent stabilizes the core within safe temperature parameters. With Bitcoin in the system, there's every chance that if you really try and clamp down on society, more and more and more of the stuff will resort to Bitcoin, and it becomes harder and harder and harder to credibly lock the doors. You can imagine, for instance, how Bitcoin might have accelerated the fall of the Soviet Union if it had existed in the 1980s, just because it would have made the black market so much more powerful than the government in all kinds of ways. So Bitcoin serves a protective function, a balancing function that didn't exist before. And that does not require any extraordinary claims about its security against the NSA. And the US government will be alright with this kind of re-balancing? Well... Wall Street's arrived. Wall Street on one side, Silk Road on the other. It's the 1980's all over again! We need Wall Street? I'm not saying we need Wall Street, but what I am saying is that the financial markets and the drugs guys have been in bed together for a very long time. And the fact that the current venue for that kind of thing actually happens to be Bitcoin, you know... the US government did not go around shooting everybody from Wall Street in the 1980s when it was cocaine and suitcases full of cash used to finance leveraged buyouts, now did it? My suggestion for Bitcoin would be to integrate Wall Street as fast as humanly possible. Teach the Wall Street guys how to use proper cryptography, teach them how to use blockchains, teach them that the state is not always their friend, and teach them that they should be thinking about engineering around it. If Bitcoin is gonna drift into Wall Street, let's teach them some of our bad habits. Let us make them like us, rather than us becoming like them. Many bitcoiners would rather not see Wall Street involved at all, in order to preserve Bitcoin's promise of freedom... Well, that kind of utopian vision, unfortunately, is total horseshit for Bitcoin. There are three problems: natural monopolies, cartels, and power law distributions of wealth. Bitcoin-mining is specialized by groups with heavy technological capability and enough financial strength to get custom hardware made. These miners have now pooled their computing power together because it evens out their earnings, effectively minimizing their risk. In the case of Ghash, this even puts them perilously close to the 51 point for control of the blockchain. This is cartel power. Meanwhile, the distribution of bitcoins seems to replicate the current situation where 300 billionaires control the same amount of wealth as three billion poor people. This is partly because of early adopter dynamics and the increasing hardship of the mining process, but there's also some evidence that power law distributions of wealth is just what happens in unregulated economies. This is a point many libertarians would argue against... but we're doing the experiment right now, and there's every indication that the basic structures of libertarian economics do push into that direction. And then you have the Bitcoin Foundation, which is emerging naturally from the Bitcoin environment simply because it has established an economically efficient configuration. By paying the technical priesthood of Bitcoin known as the Core developers, the Foundation has created a huge amount of centralized power within a system that didn't really start with any, which has now effectively turned it into a natural monopoly. And once you have a monopoly, it looks like a state. No wonder that the Bitcoin Foundation looks so frightening. If you don't like the Bitcoin Foundation, you could start a new one, right? Sure, absolutely. Just like you could start a new river Thames. Have a shovel. Start digging. Look, every type of complex system needs indexing, and while decentralization is very resilient, it is also very expensive and inefficient. So indexes tend towards being singular. A single Yellow Pages, a single phone book... Two is much less useful than one, because with one it's either in the book or it's not. Plus, complex systems often require centralized accountability in order to function properly. Get fifty people in a room, get them to organize some sort of task, somebody will wind up acting as a routing hub, that person now turns into a de facto leader. "Natural" in natural monopoly doesn't mean good, it just means that it's an economically efficient configuration. But we could start a new Bitcoin Foundation... We could. But even if it is efficient, we'll have replaced one corruptible structure with another corruptible structure. "We've picked a new set of bureaucrats, and we've done so very carefully, they work for us. Today. Tick... tick... tick... Wow these guys are kind of jerks... Tick... tick... tick... Can we get rid of them? Maybe we should start a third Foundation!" Right? No progress. Doesn't work. How about a "one bitcoin one vote" arrangement for Bitcoin-development, like you've suggested before, or a crowdfunding platform such as Mike Hearn's Lighthouse? "One bitcoin one vote" arrangements for Bitcoin could certainly dilute the natural monopoly of the Bitcoin Foundation, and a bounty-based scheme such as Lighthouse probably has similar dynamics in practice. These are both definitely better solutions than an unaccountable natural monopoly running the development process. But they do make Bitcoin a society in which the rich can use their accumulated wealth to pay the costs of changing the rules of the game to favour them even further. That's a problem if you want freedom. Winner-keeps-winning games eventually result in misery all the way along the long tail of poverty. Reify property as the core of politics, and you'll eventually wind up as slaves again. So you don't really consider these solutions fair either? What I'm saying is that we can't even really define fair. So if we can't define fair, and we've got a pretty hard time defining free, all that happens is that every time we build systems they run off the rails. What a lot of these Bitcoin-kids don't realize, is that they're playing with nuclear weapons. They're taking the full force of this creation, this mathematical lightsaber, and they're swinging it around in a small room filled with young children. If you wind up in a situation where these guys win, where Bitcoin actually displaces the dollar and becomes the global reserve currency, every cut corner and every political error in their deep thinking will become the new chains that bind humanity. And the existing chains are only made out of the will of the state. These new chains are made out of mathematics, and they are a hell of a lot harder to break. You sound pessimistic. The primary function of Bitcoin, the long-term political value of this experiment more than any other single factor I can identify, is that it's teaching realism to libertarians. Libertarianism simply does not prevent the establishment of monopolies, cartels, or power-law distributions of wealth. Never has, never will. Libertarians needed to see that happen in order to understand that their ideology is actually not going to protect them against centralized power. Now they will need to decide: did they want libertarianism, where property is used to divide everything? Or did they want anarchy, where it's our inherent human nature that gives us freedom, not our property rights. If these libertarians would be good enough to grow the hell up and become anarchists like normal people, then perhaps they would start to get serious about controlling centralized authorities rather than fantasizing that they will cease to exist. How would you suggest we move forward? First of all, what I would like to see, is a very serious, large scale, political analysis project, to really try and figure out what the hell is going on. We need to start out-thinking states and government agencies rather than just outbuilding them. We've gotten pretty good at this idea that with enough eyes all bugs are shallow - that's the classic saying about open source security. But we now have a new set of security problems, which is not about finding bugs, but about analysing motives. So we need lots of eyes analysing motives, finding out whether or not we're basically shooting ourselves in the foot here. I don't see any reason why that shouldn't be another large scale open source project, like Wikipedia. An open intelligence agency, that publicly does the risk and threat analysis, publishes the results, is open to feedback, and builds a realistic study of what kind of exposure we have to these bastards. Very much like STRATFOR, but for the open source community. And the second priority - after integrating Wall Street - is taking all of the money that people are making in the Bitcoin system, and using it to build the friggin' successor. Everybody thought Bitcoin was gonna bring them freedom and liberty, but what it has brought them are three different kinds of entrapment. Let's take these lessons, and make a Bitcoin that is useless to Wall Street, that doesn't automatically create a cartel of miners, and that doesn't leave a power vacuum for development which some Foundation will fill. And I want to emphasize: this is super clearly a social problem. Not a technical one. You need to build a social understanding that can finance the technical development in order to deliver the software you want. And make no mistake: a system that solves this problem effectively is a government. I do believe this is entirely possible. In the same way that you've got the eBay mafia - a bunch of guys that got rich off inventing eBay and went on to build new amazing things - and the PayPal mafia - a bunch of guys that got rich of inventing PayPal and went on to build new amazing things - we've now got a huge Bitcoin mafia that's got buckets full of money... So where are my amazing things? Go forth! Conquer! Go out and make the world amazing! Interview With Roger Ver: His Plans to Start a New Libertarian Country Bitcoin Returns to Its Cypherpunk Roots: An Interview With Lupták and Sip of Hackers Congress Paralelní Polis The Genesis Files: How David Chaum’s eCash Spawned a Cypherpunk Dream The Bitcoin Wonder Woman: An Interview With Lisa Cheng ‘The Bitcoin-technology by itself is worth nothing’; an interview with Dark Wallet front-man Amir Taaki The Future of “Bitcoin Cash:” An Interview with Bitcoin ABC lead developer Amaury Séchet An Interview With Kavita Gupta, ConsenSys’s Pick to Oversee Its New $50M Venture Fund Is Bitcoin causing Libertarians to Experience Wet-Dreams? An Interview with “Little Duke”, founder and developer of IDCoins Why Libertarians Should Prioritize The Bitcoin Strategy Above All Others How Bitcoin Revived the Cypherpunk Revolution Back to the Future: Adam Back Remembers the Cypherpunk Revolution and the Origins of Bitcoin Interview: Teaching Bitcoin With @AnilSaidSo Fusing Blockchain and IoT: An Interview With Filament’s CEO ‘Bitcoin Always Needed More Than One Body of Developers’: An Interview With Libbitcoin’s Eric Voskuil https://bitcoinmagazine.com/articles/bitcoin-millionaire-announces-winner-1… https://bitcoinmagazine.com/tags/interview https://en.wikipedia.org/wiki/E-gold https://guptaoption.com/cheapid/ https://hexayurt.com/ https://www.cypherpunks.to/faq/cyphernomicron/cyphernomicon.html https://www.youtube.com/watch?v=FHFSvttMg6E https://www.youtube.com/watch?v=sX-9Cyk1nkM

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Fwd: SpaceX Interlocking Directors’ Intent to Manipulate Markets
by professor rat 28 Jul '22

28 Jul '22

Mollusk companies considered harmful? I'm shocked - SHOCKED! This guy bought a car, & years later Tesla reaches in remotely with no warning and literally cuts his usable range by a third! https://twitter.com/wk057/status/1551713024171548672 He's the young Cohagen - a manipulator

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Cryptocurrency: Some Early Days
by grarpamp 28 Jul '22

28 Jul '22

Brief of some days, for the many who weren't present... https://cointelegraph.com/magazine/2021/03/03/the-reformed-bitcoin-maxi-who… The reformed Bitcoin Maxi who saw the light: Erik Voorhees “It seemed to me antithetical to have a decentralized digital economy where there is only one chain.” Elias Ahonen by Elias Ahonen March 3, 2021 in Columns, Journeys “We felt like we were doing God's work,” explains cryptocurrency payments pioneer Erik Voorhees as he recalls trying to convert the unbelievers in the early days of Bitcoin. The man whose gambling platform SatoshiDice was once responsible for half of all Bitcoin transactions, is now an elder statesman of crypto and the CEO of the ShapeShift exchange. He remembers Bitcoin being written off as a joke at the Money 2020 conference in Las Vegas back in 2012. At the time he was working for BitInstant, one of the first Bitcoin exchanges, and they had a booth right next door to PayPal. “I remember the PayPal people nearby kind of snickering at us. A couple of them had maybe heard of Bitcoin. If they'd even heard about it, it was a total joke — a stupid scam on the internet, or something. It was a totally unproductive conference.” History has not been kind to the snickerers and scam-sayers, many of whom have since been converted. In 2020, eight years after the conference, Paypal finally joined the fray, enabling users to buy and sell crypto, and it will soon add it as a method of payment at 29 million merchants. Voorhees spread the gospel of Satoshi at the conference alongside Charlie Shrem and Roger Ver. Shrem was the founder of BitInstant, viewed by some as a martyr to the cause after serving two years in prison on a case related to an exchange user reselling Bitcoin on the darknet marketplace Silk Road. Ver was perhaps the biggest believer of all, earning the nickname ‘Bitcoin Jesus’ for his charismatic promotion of the currency. “In terms of proselytizing, Roger was the absolute best. He was a total maniac about it” Voorhees recounts with a chuckle. “Even for Charlie and I, who were very much supportive of the general sentiment, It was pretty overwhelming and just incessant.” “Everyone that works at a startup feels a little bit like they're changing the world, that they have this huge mission, and certainly every company tries to amplify that,” he says, being a CEO himself. But for Bitcoiners, Voorhees clarifies, “it is really a ‘change the world’ kind of thing, and to change the world on a fundamental level. It's to change the institution of money itself — that is a profoundly tall order.” Vorhees explains that he sees Bitcoin as nothing less than revolutionary: “It's not just a better user-interface for the money that people had before. It’s a different type of money that changes government, changes culture, changes social and economic relationships on a very very deep deep level. That's why it's taken so long to to catch on, to get recognized, because it is trying to move into such an entrenched institution.” It's 2012. @ErikVoorhees @rogerkver and I decided to pool our money together for the first #Money2020 event. We told them we wanted the best booth we could afford, but we needed to be next to the @PayPal booth so we can show the world OUR financial system! Welcome, Paypal! pic.twitter.com/5BzvQDfvFb -- Charlie Shrem (@CharlieShrem) October 21, 2020 Libertarian roots Now 35, Voorhees spent his early ‘90’s childhood in the mountains of Colorado before moving to the University of Puget Sound near Seattle in 2003. He studied international economics and business but doesn’t really feel like he learnt either. “In the entire major of economics, though I had courses in the history of economic thought, I never learned about the Austrians,” he says, referring to the Austrian School of economics. Often ignored by mainstream Keynesian economists, Austrians are obsessed with things like hard money and decry unbacked fiat currencies so they have been embraced by gold-bugs and the Bitcoin community, which is after all, often called ‘digital gold’. A freshly minted graduate in 2008, Voorhees left to pursue adventure in Dubai where “anyone with a college degree could immediately get a job, because they were growing so fast.” Working as a marketer for a real estate agency, he watched from a distance as the world he thought he knew began to buckle under the weight of the unfolding Global Financial Crisis. Dubai did not feel its effects until half a year later, he recounts, describing the intervening time as “this very weird period where Dubai was going through this massive economic boom, and the rest of the Western world was falling apart.” From this desert oasis spared from the global drought, the business and economics graduate “started really understanding money on what I felt was a very fundamental level.” For Voorhees, the story of money is a simple one: “money emerges as the good that is bartered for most frequently.” That used to be gold and is currently fiat money, but it could just as well be something else, if a more useful and efficient money was embraced. Upon this realization, Voorhees took on a “very strong aversion to fiat currency and to government control of money” because as a believer in a market economy, he felt that no government should control the price or distribution of any goods. “Money was actually the most important good of all, and thus most important to not be centrally planned. And yet it was even in, you know, allegedly capitalist economies,” he says. “A capitalist economy that has a government-managed money system seemed completely antithetical, but I didn't have any answers or solutions to that other than some kind of return to the gold standard, which seemed somewhat anachronistic.” Voorhees returned to Colorado after two years abroad, soon moving to New Hampshire to join The Free State Project, an organized political migration which he describes as “a multi-decade initiative to move 20,000 radical libertarians to one small jurisdiction [New Hampshire] to hopefully have an outsized influence on the political structure.” It was there, in the company of fellow radical libertarian political activists, that Voorhees encountered Bitcoin in 2011. “At that point I got completely hooked, and a year later ended up leaving New Hampshire and moving to New York to join Charlie Shrem at BitInstant.” There, he took the reins of marketing as employee number three. It was around that time that Charlie Shrem, Roger Ver, and Erik Voorhees — each of whom would go on to become crypto-luminaries in their own right — pooled their money together to set up a Bitcoin booth at the Money 2020 conference in Las Vegas. “We needed to be next to the PayPal booth so we can show the world OUR financial system,” Shrem recounted. Vorhees says they failed to convert anyone to Bitcoin at the conference despite their best efforts. Belief in false profits Vorhees admits he used to be a Bitcoin Maximalist, a believer in the one true coin who rejected all false currencies. “I used to be a maximalist. Obviously when I got into Bitcoin, it was kind of the only coin,” he says. “As other coins came out I dismissed them, scoffed at them, and generally didn't like them because I felt like they were a distraction from the important project.” Though he tried to focus on Satoshi’s vision, the new projects started gnawing at him and he realized that many of them “were doing things that Bitcoin wouldn't do or couldn't do.” By mid 2014, his conversion was in full swing. “My whole mindset began changing. One of the most important things about Bitcoin is that it is decentralised. And it seemed to me antithetical to have a decentralized digital economy where there is only one chain — you know, one code base, one chain, one set of economic rules. It seemed very appropriate that you would get multiple different digital assets, and that was actually part of the decentralization, part of the virtue of Bitcoin was that Bitcoin isn't the only thing there.” He tempers this by adding the usual provisos — most tokens are garbage, many are scams, a majority will fail. “It's only a minority of them that are interesting, but a minority is a lot more than one.” ETH Folks... try not to become to Binancechain what the Bitcoin Maxis are to Ethereum <U+1F64F> -- Erik Voorhees (@ErikVoorhees) February 19, 2021 He still has empathy for his “shortsighted” maximalist peers, who he sees as victims of human nature’s tendency toward tribalism, which expresses itself in lots of ways, “Certainly it expresses itself in religion. And it has expressed itself in crypto, and some portion of people- their mind twists itself into complete advocacy of one flag and complete derision of all others.” “[It’s] a group psychological phenomena and I don't know how that stops, but I do think it is really harmful for the growth of decentralized digital finance generally.” Gambling with Satoshi's dice Only a year after learning about Bitcoin, Voorhees launched Bitcoin-based gambling site SatoshiDice in 2012, which took the young crypto community by storm. “On Reddit, this guy posted that he had created this casino-like mechanism where there'd be this dice roll, and based on the dice roll, a user would either get their coins sent back or lose them. I tried it, and there was magic in it immediately […] So I started working with him.” This was groundbreaking because “it allowed any person in the world to place a bet by sending a Bitcoin transaction” no matter where they were from or how their local laws governed online gambling. What's more, the player did not need to trust SatoshiDice, because “it was provably fair,” meaning that it worked like a transparent machine where all odds and inner workings were open for anyone to inspect. Governments around the world have various commissions to regulate and audit gambling operations, but SatoshiDice’s function potentially made such organizations obsolete, powerless, or both. “SatoshiDice showed you what the odds were. It was transparent with the odds, and you could prove that the rules were fair.” The simple, trusted, and permissionless nature of SatoshiDice brought huge success to the platform. Within months of launch, the game was responsible for as much as half of all Bitcoin transactions. SatoshiDice had an unofficial IPO on the MPEx exchange, a sort of Bitcoin stock market where unregistered Bitcoin companies offered shares and paid dividends denominated in BTC. These were the forerunner of the ICO boom several years later, and attracted similar attention from authorities for breaking securities laws. Though the casino was “making a tonne of money,” it was also overwhelming as Voorhees felt his job of “running the world's biggest Bitcoin casino” was distracting him from his greater calling of preaching the good word of Satoshi. Despite ongoing growth, he reluctantly sold the business in 2013 for 126,315 BTC which was then worth $12 million. That would be a cool $6.25 billion today. Fighting the system Voorhees did not enjoy calm for long, as the US Securities and Exchange Commission (SEC) soon came after him for making a public offering of unregistered securities. Voorhees considered this unfair, seeing that his investors had made exponential returns. He ended up settling for $50,000. “That was nine months of total misery, dealing with them. If I didn't despise the government before, I certainly did it after that. It was such bullshit.” A core value of his is that people should be free to transact with each other voluntarily, and that no government agency has the right to come in between them. In his worldview, “institutions and government exist purely to curtail people's power over money,” whereas “crypto gives people total economic power to make transactions in any way they wish, and no one can stop it.” As Voorhees sees it, these two forces will inevitably clash. Voorhees’ company Shapeshift allows users to trade cryptocurrencies without identity verification. Things were not always that way — in 2018 Voorhees says his company fell under the same rules as traditional banks and therefore had to implement Know Your Customer, or KYC, identity verification procedures, making anonymous transactions impossible. “That was absolutely miserable. Our customers hated it. I hated it.” But by 2020, decentralized exchanges (DEX’s) which allow users to trade without depositing their funds with a third party were gaining ground and made it possible for Shapeshift to reorient its business and re-align with its libertarian values. All KYC was abandoned, and the platform became a gateway for users to trade on various DEX’s. “I had learned with Satoshi Dice that an economic relationship didn't need anything other than a public key to send in a transaction, and anything else could be based around that,” he says. Voorhees says that his opposition to KYC is not down to ideology but his desire to protect users against things like identity theft. “Identity theft in the US alone is something like a $30B to $40 billion a year problem. It is more costly than all forms of property theft combined. It's this massive thing, and crypto comes along and solves that problem.” But how committed is he to this principle? Would he class it as theft if a government accessed user data to tax a client’s unreported financial transactions. “Yeah, exactly. Taxation is absolutely theft,” he responds with blunt matter-of-factness. The WSJ investigates ShapeShift’s ethos has proven controversial among adherents to the rules and regulations around traditional finance. An investigation by the Wall Street Journal alleged Shapeshift users had laundered $9 million via the platform. However a third-party analysis by blockchain intelligence firm CipherBlade suggested the investigation was flawed in assuming that funds were illicit even after passing through four different hands, causing the $9 million figure to be inflated by a factor of four. It is clear that Voorhees, who is normally calm and composed, was deeply affected by this. “Here’s The Wall Street Journal coming after us, calling us the money launderer, when their own inflated number would put us as far better [at combating money laundering] than any of the major banks that they write about all the time.” There's a noticeable quaver in his voice. The battle is personal. We spend the last minutes comparing attitudes toward money in different societies. In the Nordic countries for example, all taxes are a matter of public record. Voorhees finds this disturbing, adding that “a lot of people with money feel guilty about it” whereas creating wealth in an ethical way he believes is a good thing for society. “I would like to see people who become very wealthy, first of all be proud of that, so long as they did it in an ethical way, and to use those resources in whatever way they think is best. I think that's how that's how economies grow and I think there's nothing wrong with that.” Elias Ahonen Elias Ahonen is a Finnish-Canadian author based in Dubai who has worked around the world operating a small blockchain consultancy after buying his first Bitcoins in 2013. His book ‘Blockland' (link below) tells the story of the industry. He holds an MA in International & Comparative Law whose thesis deals with NFT & metaverse regulation. https://arstechnica.com/information-technology/2013/08/firm-says-online-gam… https://cointelegraph.com/news/wsj-claim-of-9-mln-laundered-via-shapeshift-… https://www.cnbc.com/2017/12/08/what-bitcoin-millionaire-charlie-shrem-lear… https://www.wsj.com/articles/how-dirty-money-disappears-into-the-black-hole… https://www.sec.gov/news/press-release/2014-111 https://en.wikipedia.org/wiki/Free_State_Project https://en.wikipedia.org/wiki/Gaming_control_board https://shapeshift.com/ https://twitter.com/CharlieShrem/status/1318904047236153348 https://twitter.com/ErikVoorhees/status/1362781521153720323 https://twitter.com/PayPal https://twitter.com/hashtag/Money2020 https://twitter.com/rogerkver https://cointelegraph.com/magazine/author/eliasahonen124 https://cointelegraph.com/magazine/columns/journeys https://cointelegraph.com/magazine/tag/bitcoin https://cointelegraph.com/magazine/tag/bitcoin-maxi https://cointelegraph.com/magazine/tag/bitinstant https://cointelegraph.com/magazine/tag/charlie-shrem https://cointelegraph.com/magazine/tag/cryptocurrency https://cointelegraph.com/magazine/tag/erik-vorhees https://cointelegraph.com/magazine/tag/paypal https://cointelegraph.com/magazine/tag/roger-ver https://cointelegraph.com/magazine/tag/satoshidice https://cointelegraph.com/magazine/tag/shapeshift

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